Author Topic: Shad Khan Isn't The Only One!  (Read 8959 times)

Metro Jacksonville

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Shad Khan Isn't The Only One!
« on: March 26, 2015, 03:00:04 AM »
Shad Khan Isn't The Only One!



Jacksonville Jag’s owner Shad Khan, and his company Iguana Investments, are proposing plans for a major to the Jacksonville shipyards. Khan’s money would transform the 48-cre lot on the downtown riverfront into a vibrant entertainment and leisure district.

However, Khan isn’t the first of his kind. What follows is a brief list of other major profession sport team owners who have invested in large scale urban redevelopment projects, too.


Read More: http://www.metrojacksonville.com/article/2015-mar-shad-khan-isnt-the-only-one

simms3

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Re: Shad Khan Isn't The Only One!
« Reply #1 on: March 26, 2015, 04:48:43 AM »
I just want to point out a few things.  Not trying to say Khan can't do it, nothing like that.  But there's always more to the picture.

Jeff Vinik is a former hedge fund manager and an index/mutual fund manager.  This is a guy that's been involved in or exposed to real estate for a long time and has a solid finance background.  Wall St guy.

I don't know anything about Richard Devos' background beyond what Wiki says and I can't easily find any articles on his proposal.

Stephen Ross is the co-founder of Related.  Not only is this guy pure Wall St, he's 100% been focused on real estate his whole life - he is one of the wealthiest and most well known real estate developers in global history.  The Michigan business school is named after him and there are a lot of interesting rumors about that (mostly positive, but interesting).  His co-founder/partner is Jorge Perez, who is FL's most well known developer and focuses on Miami.  In other words, career/experience wise there is nothing similar between Khan and Ross aside from the fact that both have invested in professional sports teams and both have made billions through their endeavors.  To say that Stephen Ross can put up a large, complex multi-phase, mixed-use high-rise urban development in the world's most urban city over a rail yard is an understatement - Ross is probably one of less than 5 people globally who has the wherewithal to do that.

Dan Gilbert probably had a start similar to Khan, with limited real estate experience, but probably more exposure to it and to Wall St through his company Quicken Loans.  His foray into real estate seems to have evolved from a corporate relocation decision (to move Quicken to DT Detroit), and now another big focus is his PE firm, Rockbridge, which is run by all former Wall St guys and Big Law partners who have exposure to real estate through that.  Coincidentally, Quicken Loans occupies all or most of the buildings owned by Rockbridge - so Rockbridge might have a vehicle that is essentially an investment in Quicken through real estate.  Not sure how that conflict of interest is managed so that both Quicken Loans and the investment vehicle managed by Rockbridge mutually benefit, however, that's the majority of his real estate investment - an investment tied to separate corporate decisions.

It sounds like Khan's setting up something like Gilbert through Iguana Investments and again, tying real estate forays into an existing venture owned by Khan (the Jags).  But that doesn't mean he won't be surrounding himself with guys who might have more experience/exposure to real estate/Wall St with connections to hedgies, real estate groups, banks and their equity divisions, etc etc.

For the record, there are some big things going on with the GS Warriors in San Francisco (where Uber will occupy most if not all of the office component of a new arena/development going up), with the SF Giants (where ownership management...which is 32 members strong led by former CEO of Franklin-Templeton, is working on a huge multi-billion dollar deal across the canal from AT&T Park with an initial thing opening up this weekend), and with both the Oakland A's/Raiders (a group led by FLoyd Kephart who runs an equity/capital markets advisory shop, not unlike Lazard, Rothschild, Capmark, or others...and will use his connections to sign on a bunch of hedgies and PE funds to do the Coliseum City deal if the City and County can work out a deal to pay off their joint interest in some remaining debt).

There's obviously the big stadium/development deal down in Carson in LA, which I know too much about to discuss, and the deal in Cobb County near Atlanta, where the Braves are relocating.  The Braves ownership management are putting up a larger mixed-use development that I know the City of Atlanta would have liked them to build where Turner Field is, though there are clearly some specifics about why the Braves didn't work out in Atlanta that I'm unaware of (the "side" I know of has me forever more hating the Braves).  The stuff going up at and around Levi's Stadium in Santa Clara is also fairly interesting, though I don't know if that's completely separate or if Niners ownership has a stake in that, too.  Too tired/lazy to look it up.
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thelakelander

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Re: Shad Khan Isn't The Only One!
« Reply #2 on: March 26, 2015, 06:01:12 AM »
The largest difference I see between Khan and Gilbert is that Gilbert has personal ties to Detroit. He really is their sugar daddy.
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Re: Shad Khan Isn't The Only One!
« Reply #3 on: March 26, 2015, 06:49:12 AM »
Even the smallest market is doing it... 8)

http://www.jsonline.com/sports/packers/development-begins-near-lambeau-field-b99469074z1-297604991.html

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Development begins near Lambeau Field

Phoenix — Anyone who has been around Lambeau Field lately can see that the land west of the stadium is ready for development.

The Packers have bought out all the land along the south side of Lombardi Ave. between Ridge Road and Marlee Lane and leveled all but one business as part of their Titletown redevelopment plan.

Their hope is to create a business district that will enhance the Lambeau Field experience and create new streams of revenue for the team. The first stage of that development was the purchase of land along Highway 41 where a Cabela's was built.

Packers President Mark Murphy, speaking at the close of the NFL owners meetings at the Arizona Biltmore, said Wednesday the team is getting closer to announcing plans for which tenants will occupy the land it owns, but they are taking it slow.

"We're studying it," Murphy said when asked if the Packers were close to announcing a major tenant. "I think long term it could be one of the most impactful things we do, if we do it right.

"We want to make sure we get it right....It will be a mix of a lot of different things."

Most of the area will feature businesses such as restaurants, retail stores and possibly hotels, but Murphy said there are plans for a public plaza set aside for fans on game days and visitors and locals the rest of the time. Murphy didn't provide any details about where the plaza would be or how big it would be.

In addition to the development around the stadium, Murphy said there were several projects still under construction inside the stadium and another one on the way.

Besides the $166 million privately financed renovation of the Lambeau Field Atrium, a new Wi-Fi system is being installed to allow fans easy access to the Internet during games.

Murphy said the next project the Packers will tackle is renovating the luxury suites. He said aside from the suites that were added with the south end zone renovation, the luxury boxes have not seen any major changes since they were first added in 2003.

He said one of the most common requests was from suite holders who want open-air capability.

"That's something we've studying for awhile," Murphy said. "(It's the) biggest issue we hear about, 'I love our suites but I want to feel connected.'"


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tufsu1

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Re: Shad Khan Isn't The Only One!
« Reply #4 on: March 26, 2015, 08:29:16 AM »
Jeff Vinik is a former hedge fund manager and an index/mutual fund manager.  This is a guy that's been involved in or exposed to real estate for a long time and has a solid finance background.  Wall St guy.

Vinik also has the financial backing of Cascade Investments, LLC....controlled by some little known guy by the name of Bill Gates

simms3

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Re: Shad Khan Isn't The Only One!
« Reply #5 on: March 26, 2015, 02:21:32 PM »
From an article in today's business times regarding another party joining the team/effort to keep the Raiders and redevelop the stadium and surrounding area into "Colisseum City".

Quote
Now SunCal again is involved in the project jumpstarted by Floyd Kephart's New City Development LLC, Reid said. SunCal would play an important role "because the Raiders are not developers," Reid added. "This is a very complicated deal."

Quote
New City has not determined what groups to involve in developing Coliseum City, but there could be separate developers selected for the hotel, residential, office and retail aspects of the project, which may be built in conjunction with the stadium.

If New City makes a successful proposal that is approved by the city and county this summer, Coliseum City building permits could be issued as early as next year — if all goes perfectly — and the Raiders could be in a new stadium in time for the 2019 National Football League season.

If SunCal jumped into Coliseum City in a larger development role, it would add even more heft to a portfolio of East Bay projects and wannabe projects. It filed plans recently for a 935-unit mixed-use development at the former Oak Knoll Naval Hospital in Oakland, and it is competing against two other developers for the right to develop the potential 12,000-unit Concord Naval Weapons Station site.

The company also recently bought a 14.6-acre site in downtown Los Angeles — described by Bloomberg to be the size of 11 football fields— for $130 million. That area is transitioning from industrial space into an arts district.

http://www.bizjournals.com/sanfrancisco/blog/2015/03/coliseum-city-oakland-raiders-suncal-kephart.html?page=2
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JBTripper

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Re: Shad Khan Isn't The Only One!
« Reply #6 on: March 26, 2015, 02:50:49 PM »
Quote
The Braves ownership management are putting up a larger mixed-use development that I know the City of Atlanta would have liked them to build where Turner Field is, though there are clearly some specifics about why the Braves didn't work out in Atlanta that I'm unaware of (the "side" I know of has me forever more hating the Braves).

If Atlanta wanted the Braves to build what they're building in Cobb County down by Turner Field, then Atlanta would have given them the incentives that Cobb County is giving them and agreed to pay for stadium renovations. Instead, Atlanta is spending its money on the Falcons by replacing the 23-year-old Georgia Dome with "New Atlanta Stadium." For context, on opening day in Cobb County 2017, Turner Field will be 20 years old, 21 if you count it's one year as the Olympic Stadium.

The Braves are being vilified for the move to Cobb, but ultimately the city made the choice for them. There's a whole laundry list of things the city has (not) done to lead to this move: Refusal to incentivize surrounding development as promised after the Olympics, refusal to pay for renovations to city-owned Turner Field, and refusal to connect MARTA rail come to mind.

Sorry to derail the discussion, but there you have it.

simms3

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Re: Shad Khan Isn't The Only One!
« Reply #7 on: March 26, 2015, 03:06:51 PM »
^^^There are definitely 2 sides to that story, and at that level, I've heard both sides - the deeper backroom discussions I am unaware of but have heard things through the grape vine coming from one side.  Yes, Atlanta "picked" a winner and a loser, but there's a lot more to it.  There are other agencies and parties involved in the Falcons deal, including at the state level, which removes an element of control by the city (it was also lower hanging fruit, more $$$, some of the difficulties with the Braves such as transit connectivity were already mitigated with the Falcons, and the deal terms were probably better constructed from the city's perspective, plus you have the outside influence of the state involved there and any deleterious effects on the city/environment were shouldered by a largely poor and disenfranchised section of the city versus a gentrifying and now largely white/middle class Grant Park where Turner was located...so NIMBYism and opposition was less strong, unfair as that may be).  There's also no feasible way MARTA was ever going to connect to Turner via rail, and that was very certainly merely a talking point with both parties knowing full well that nothing could be done about that.

The other thing to consider is that the NFL is akin to the beggar as far as professional sports is concerned.  They would never do an entirely private deal and they'll always take a handout...in fact demand a handout.  MLB is very different and many if not most new stadium deals these years are far more privately financed and maintained and coupled with mixed-use development by 3rd parties involved in some sort of larger scheme/structure.

The risk structure of a baseball stadium operation is pretty different from that of an NFL stadium operation, and it's much easier to supply parking/access and develop surrounding areas.  It actually makes sense that the city would choose NFL over MLB for public financing.

The biggest irony of it all is how Republican Cobb County is and yet how they basically got down on their knees and immediately sucked off the entire Braves ownership/management group WHILE paying them money to suck them off so that they could get that stadium.  And the hypocrisy of the tea partiers in that county for letting it happen while preaching whatever fiscal responsibility bullshit it is that they preach.

Since we're off topic...lol
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JBTripper

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Re: Shad Khan Isn't The Only One!
« Reply #8 on: March 26, 2015, 03:56:34 PM »
MARTA certainly could have happened when they originally built the rail back in the 1970s, just by swinging the South line a little to the East (or the East line a little to the South) to the old Atlanta-Fulton County Stadium. Also, I don't know anything about the risk structure of baseball vs. football stadiums, but it seems counter-intuitive that eight home games would be better than 80. As for NIMBYism in Grant Park... isn't it already in their backyard? Wouldn't the neighborhood benefit tremendously from a 365-day development nearby instead of the vast parking lots and vacant lots that exist now? Seems like a walkable development in Grant Park would be a boon to the area, not a detractor.

You're right on about the Tea Partiers in Cobb, although wouldn't it be cool if federal taxes were a little less onerous and people could vote to increase their own taxes at the local level to support projects like this? That should probably be part of their message, instead of NO TAXES RABBLE RABBLE. It would also be cool if that's actually how that all went down instead of backroom dealings and an announcement out of left field. Oh well. :/

simms3

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Re: Shad Khan Isn't The Only One!
« Reply #9 on: March 26, 2015, 04:22:13 PM »
^^^The point about 8 games and a few events versus 80 games and a few events was precisely my point - intuitively, there is less risk with the operation of a baseball stadium, which is smaller, cheaper to build, "lower-frill", and more events.  A private club at a baseball stadium can be just as lucrative as a private club at a football stadium for parties and events (I would imagine), so then the differentiator is the cost vs revenue equation on the games side, which explains why baseball tickets are so much cheaper than football tickets.  All of the other nuances I am not in the business of knowing but I think you and I are on the same page.  Less sheer land needs to be taken up by baseball stadiums, as well, given their footprint and seating and the fact that they have so many more games and can operate profitably at a lower admission rate than a football stadium, which has 8 chances to make it or break it.

RE: NIMBYism - NIMBYism is usually illogical.  It's people opposed to change, even if it means change for the better.  NIMBYs who are middle class white folk have a higher chance of being heard and listened to or stopping something in its tracks than disenfranchised black folk in the poorest part of the city.  Yes, plenty of people in Grant Park would be thrilled.  Others would be concerned with "visitors" to their neighborhood and increased traffic, and the list could go on (yes, all of that is already there with 80 baseball games, but I can tell *you're* not a NIMBY so illogical thought patterns such as these are not entering your mind already).

RE: MARTA - nobody in the 50s, 60s, and 70s when MARTA was being designed and built had the foresight to predict this predicament that Atlanta found itself in in 2013-3014.  Hard to fault them for that.

It should be pointed out that transit to Cobb Co's new Suntrust Field will be totally nonexistent.  The Braves had shuttles from Five Points Station to Turner and from personal experience, it really wasn't even that bad of a walk (20-30 min, at least half of that time would have been spent parking anyway if arriving by car) and plenty did that, too.

Also it should be pointed out that the Braves are the SE's team, not just Atlanta.  The Braves are one of the top attractions for visitors in Atlanta.  Yes there will be some new hotel rooms developed by Suntrust Field.  But nowhere near the thousands of centrally located hotel rooms in DT Atlanta near all the other attractions and reasons to visit.  This hurts the greater fan base outside of suburban north Atlanta, in my opinion.

Not to continue off topic...but it was interesting following this whole thing play out when it did...everyone I know in Atlanta was REALLY pissed and I think the Braves actually lost fans over it, in the name of "moving closer to their fan base" ironically.
« Last Edit: March 26, 2015, 04:25:32 PM by simms3 »
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I-10east

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Re: Shad Khan Isn't The Only One!
« Reply #10 on: March 26, 2015, 07:55:34 PM »
^^^Simms, I heard you say that 'you aren't trying to say Khan can't dive into real estate', so I'm gonna take that into consideration. Khan came into the football world without any formal distinctions, and became the first minority NFL owner. He is known to assemble a team around him to perform tasks, just like he brought in Mark Lamping who has done a phenomenal job with renovating EverBank Field. Khan himself doesn't need to be a Wall St guru to assemble a necessary team around him concerning real estate ventures.

simms3

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Re: Shad Khan Isn't The Only One!
« Reply #11 on: March 26, 2015, 08:18:00 PM »
^^^And by no means am I disagreeing.  But there is so much Khan is God sentiment it seems that I like to point out that the man is a mere mortal.  Also, comparing Khan to Stephen Ross and saying, "look - other 'NFL owners' have been successful at developing real estate" is implying that they all got rich through whatever means, bought a football team, and then decided to do some real estate deals.  Most NFL owners are not directly dabbling in real estate (though if you're rich enough to wholly or majority own an NFL team, you're rich enough to have a family office that might invest your liquid assets on your behalf, which could easily include a direct investment in real estate or an investment through a pool set up by a JPM).

The ones that are getting directly involved in real estate either are already developers themselves and that's how they made their money in the first place, like Ross, or are generally finance guys that got exposed and have used their Wall St connections and experience to set up teams and go almost like a traditional RE PE route, with themselves as founder/main principal, and a team in place to execute.  Vinik is a former hedge fund guy.  All hedgies have a hard on for real estate.  He's underwritten some deals in his life before deciding to headline his own act.
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Re: Shad Khan Isn't The Only One!
« Reply #12 on: March 26, 2015, 09:30:37 PM »
I realize that my comment is teetering on the edge of trolling (who am I kidding?), but by using Simm's sound logic here, if you made your fortune in Wall Street trading medical stocks, you should basically be able perform open heart surgery because of all your research and connections in the field.

...that's how they made their money in the first place, like Ross, or are generally finance guys that got exposed and have used their Wall St connections and experience...

Or you could just stay at a Holiday Inn Express....

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simms3

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Re: Shad Khan Isn't The Only One!
« Reply #13 on: March 27, 2015, 02:19:16 AM »
I think there's a difference between "trading medical stocks" your whole life and underwriting a wide variety of deals and having exposure and forming relationships with all of the parties involved in doing actual deals, including real estate deals.

My point is that Khan's TEAM, whoever he sets that up to be, and however this ends up being structured with the city, which is clearly participating as it should in some way (through some sort of promote on the horizontal component or that 50-50 split on upfront proceeds as mentioned) will be working on this.

In fact, anyone networking and open to new opportunities and interested in real estate in the city, perhaps on this site, is probably already having dinners and drinks with those already involved in Iguana.  Khan is the name and frontman behind it, but he's not a god nor is he a real estate developer or finance guy.  I just take issue with equating Khan with people like Stephen Ross or others mentioned because their experience is vastly different and what they bring to the table is not the same.

I should realize my audience, such as you, before mentioning the "street".
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JBTripper

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Re: Shad Khan Isn't The Only One!
« Reply #14 on: March 27, 2015, 10:43:35 AM »
Oh I guess I misunderstood. I thought you were saying it was riskier to build a baseball stadium than a football stadium. My bad.

I still maintain the Braves did the right thing for them and don't deserve to be vilified the way they have been. The move may or may not have been in the best interest of the city proper, but that's not the Braves' responsibility. The area they're moving to has a brand new performing arts center and is connected by miles of walking/biking trails to the Chattahoochee River National Recreation Area. There's plenty to do out there and it's not as though every attraction in town has ever been centrally located anyway. Nobody has ever seen everything in town without getting into a car, anyway: Stone Mountain, Kennessaw, Buckhead, Centennial, Turner Field... it's always been scattered all over town.

I grew up in the North Atlanta suburbs and I can tell you they haven't lost any fans up there, and that's without question where the vast majority of the fan base is located. The new yard is going to be about a quarter-mile from my parents house, so I'm pretty excited about visiting. Of course, by Opening Day 2017 my folks will probably have retired to St. Mary's anyway lol.